Assume that a business collects two-thirds of its sales revenue in the month of sale and the
Question:
Assume that a business collects two-thirds of its sales revenue in the month of sale and the remaining one-third in the following month.
Required:
a How much revenue has the business actually earned in the month of the sale?
b Should the business record revenue on the income statement in the month when it collects the cash or when the work was done to earn the revenue?
c What are your reasons for choosing one alternative over the other? (What are your reasons for not choosing the other alternative?)
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a In the month of the sale the business has actually earned twothirds of its sales revenue because i...View the full answer
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Related Book For 
Accounting Information For Business Decisions
ISBN: 9780170253703
2nd Edition
Authors: Billie Cunningham, Loren A. Nikolai, John Bazley, Marie Kavanagh, Geoff Slaughter, Sharelle Simmons
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